Close Brothers, a leading UK merchant banking group, has seen profits surge in preliminary results for the 2021 financial year, registering growth across all departments.
Group income climbed by 10 per cent while adjusted operating profit grew to £270.7m, 88 per cent higher than the previous year. Investors were treated to earnings of 134.8 pence per share, up from 72.8 pence in 2020 with the board proposing a full year dividend per share of 60p.
Adrian Sainsbury, Chief Executive of Close Brothers since September 2020, commented on the company’s “strong financial performance,” saying the firm had “made the most of the opportunities arising as the economy recovers from the effects of Covid-19.”
“We are encouraged by the improvement in the economic outlook, although the trajectory remains uncertain,” he added.
The company saw revenue growth across all divisions. The banking services department drove revenues, upping intake by 114 per cent year-on-year to £212.5m amid loan book growth of 10.9 per cent and an increase in customer deposits of 12 per cent.
Takings in the Asset Management division also increased with managed assets growing by 24 per cent to £15.6bn.
Winterflood, the company’s securities arm which offers market-making, sales, research and corporate broking services, saw adjusted operating profit increase by 27 per cent to £60.9m in the year ending July 30 2021 with only one loss making day in spite of volatile market conditions.
In a statement the company said its deep experience in navigating a wide range of economic conditions, leaves the banking group in a strong position going into FY22.
Moody’s Investors Services updated its credit rating for Close Brothers Group to ‘A2/P1’ and Close Brothers Limited to Aa3/P1 with a ”negative” outlook in recognition of the bank’s strong appetite for risk.
The company’s share price dropped by 1.33 per cent yesterday after the results were published, with shares up 11.64 per cent this year to date.